Recent recommendations on how to administer Medicare and Medicaid services would put many smaller hospitals in financial peril.  That’s according to the President and CEO of the South Dakota Association of Healthcare Organizations, Dave Hewett.

The U. S. Department of Health & Human Services’ Office of Inspector General released a report last week that if fully implemented could negatively impact a majority of rural hospitals in South Dakota. These medical facilities are classified as Critical Access Hospitals.  That designation is from the Federal level which provides that Medicare and Medicaid services are reimbursed by the government at a certain rate.

Hewett highlights that Washington bureaucrats tend to paint in broad brush strokes and local impact can be overlooked.  Small hospitals cannot survive if the payments were meted out at the same rate for the larger facilities.  A higher percentage of the patients in rural areas are on Medicare or Medicaid.

(Dan Peters/KSOO)

Hewett Says Smaller Hospitals Need More Support

A description of smaller hospitals would mean about 25 patient beds.  The current reimbursement rate is 101 percent while the new rules would change that rate to 90 percent.  With the dynamic of more Medicare/Medicaid patients served at these hospitals, Hewett predicts failure for that model.

Hewett’s Gloomy Outlook if New Rules Enacted

A vigorous campaign to South Dakota’s federal Congressional Delegation to halt this rule change is underway.